New Mexico Supreme Court Stops New Energy Economy’s Bid to Block PNM’s Solar Plans

The New Mexico Supreme Court filed its opinion earlier this week affirming the Public Regulation Commission’s order approving PNM’s 2018 renewable energy procurement plan.

The PRC regulates utilities, telecommunications, and motor carrier industries in New Mexico. In one of the quirks of New Mexico’s judicial system, appeals from PRC orders are heard directly by the NMSC. The Court hears 1-3 PRC appeals per year. A party challenging a PRC order must show that the order was either arbitrary and capricious, not supported by substantial evidence, outside the PRC’s authority, or otherwise inconsistent with the law.

New Energy Economy (NEE) appears to have been one of the losing bidders. It argued that the structure of the RFP made the award arbitrary and capricious, and that the award was not supported by substantial evidence. In particular, NEE claimed that the 31-day deadline to submit a proposal was too short, and that PNM should not have limited certain designated sites to turnkey solutions only.

As is often the case with direct appeals–especially under the difficult-to-meet abuse of discretion or substantial evidence standards–this was an easy case for the Court to dispose of. There was evidence below that RFPs commonly had shorter deadlines, and that bidders commonly had proposals ready to go ahead of time. Furthermore, it was difficult for NEE to argue that it needed more time when it had never asked for more time. The Court found this sufficient to show that PNM’s process was not arbitrary and capricious. This same evidence was sufficient, in the court’s view, to support the order under the substantial evidence standard.

In discretionary appeals (such as appeals to the supreme court from the court of appeals), the Court is more likely to reverse than to affirm. But the opposite is true for direct appeals such as this one, which are more likely to result in an affirmance. As this case demonstrates, it can be difficult to obtain a reversal under the arbitrary and capricious and substantial evidence standards of review.

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